Budget outlook: Fireworks in House, compromise in Senate?

WASHINGTON — Congress will head down two very different paths Tuesday as it tackles President Barack Obama's budget plans: The House of Representatives will engage in a bitter partisan fight over current spending, while Senate lawmakers from both parties will be quietly seeking compromise.

The House will begin debating a Republican-authored plan to cut $61 billion in spending over the seven months left in fiscal 2011, a plan that would dramatically cut or end a host of popular programs. Those cuts would reduce spending to $100 billion below Obama's proposals last year for fiscal 2011 and thus meet a key goal of tea party activists.

However, that measure has little chance of getting through the Democrat-dominated Senate. Government authority to spend this year expires March 4, so some sort of bipartisan negotiation is expected, even if it produces only one or a series of stopgap funding bills to keep the government open while negotiations proceed.

Meanwhile, senators from both parties are holding a quiet series of backroom talks seeking solutions to the government's long-term fiscal problems. Their efforts are likely to prove crucial to the fate of the $3.73 trillion fiscal 2012 budget that the president unveiled Monday.

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"The president's budget gets it about right in the first year," said Senate Budget Committee Chairman Kent Conrad, D-N.D. Obama's budget looks out over 10 years.

Conrad is one of four senators who've engaged in the private bipartisan Senate discussions for weeks, and who were members of last year's bipartisan deficit-reduction commission. All four voted for the panel's deficit reduction plan. The other three are Senate Assistant Majority Leader Richard Durbin, D-Ill., and Sens. Tom Coburn, R-Okla., and Mike Crapo, R-Idaho.

Also involved in the talks are Sens. Saxby Chambliss, R-Ga., and Mark Warner, D-Va., who are liaisons to a broader bipartisan group of about 25 senators who've indicated a desire to seek common ground in striking big budget compromises.

They aim to take the deficit-reduction commission's recommendations and see which ones can get enacted into law. Obama's new budget falls well short of the commission's recommendations, which would cut projected federal deficits by $4 trillion over 10 years. The president's plan would cut the projected deficits by only $1.1 trillion over that span, even as gross federal debt expands by almost $13 trillion between fiscal 2010 and 2020.

The commission majority — 11 of its 18 members — recommended capping spending in virtually all government programs through 2020 except for Social Security, Medicare, Medicaid and some national security needs.

The panel also suggested structural changes in Medicare and Social Security finances. It proposed revamping the federal tax system from five income tax rates to three: 8, 14 and 23 percent. It called for ending or trimming about $1.1 trillion in popular tax breaks, such as mortgage interest deductions.

The White House made no such dramatic proposals Monday, and it hasn't been involved in the Senate talks. The Senate group hopes to make recommendations by early spring.

In the meantime, partisan sniping will dominate the public budgetary conversation.

Lawmakers face three budget deadlines in coming months: March 4, when government spending authority expires; later in the spring, when the government hits its $14.3 trillion debt limit; and Oct. 1, when the new fiscal year begins.

This week's House effort will focus on the current fiscal year. Last year's Congress couldn't agree on a budget, and it left spending decisions governing this fiscal year's remaining months up to the new Congress.

House Republicans ran on a "Pledge to America" that they'd cut $100 billion "in the first year alone," but initially they offered only $32 billion in cuts for the remainder of fiscal 2011.

Angry tea-party conservatives insisted on more; now the House plan would cut $61 billion from current spending, which would be $100 billion below Obama's fiscal 2011 request.

"The House of Representatives is on its way to listening to those who gave them the majority in November," said Jenny Beth Martin, national coordinator for Tea Party Patriots.

Prominent cuts target rural housing service loans and grants, the police-on-the-streets program, the Corporation for Public Broadcasting, the Corporation for National and Community Service and the high-speed rail program.

The reductions could go even deeper, as lawmakers will offer amendments. Since Republicans have a 241-193 House majority, Democrats are expected to have virtually no impact on the outcome.

Democrats are trying to paint Republicans as heartless and eager to shut down the government.

Senate Appropriations Committee Chairman Daniel Inouye, D-Hawaii, labeled the package "reckless cuts thrown together in a poorly thought-out effort to arrive at an arbitrary dollar figure ... (that would) put hundreds of thousands of Americans out of work and cripple the ability of government to carry out some of its most basic functions."

But House Majority Leader Eric Cantor, R-Va., said: "Anytime that we on our side propose a spending cut, it seems that (Democratic senators) scream 'Shutdown,' " he said. "Why is it, necessarily, that you're only hearing 'shutdown' from one side? We have consistently said it is not our intention to shut down this government."